MGM Remains All In on Osaka as Rivals Consider Other Japanese Cities For Integrated Resorts

Posted on: August 22, 2019, 02:18h. 

Last updated on: August 22, 2019, 03:34h.

Todd Shriber @etfgodfather Read More
Expertise: Financial, Gaming Business, Mergers and Acquisitions.

MGM Resorts International is reiterating its commitment to Osaka in its effort to land a prized Japanese gaming license even as at least one of its rivals shifts its focus other metropolitan areas in the Land of the Rising Sun.

MGM CEO Jim Murren still sees Osaka as the best bet for his company in Japan. (Image: TheStreet)

The company is partnering with the Japanese firm Orix to land one of the first three permits for integrated resorts (IR) Japan is expected to dole out. MGM, one of the largest operators on the Las Vegas Strip, has long been committed to Osaka and has recently been reaffirming that notion with overtures such as a show called “Japanese Spring” at the 2019 Bellagio Las Vegas Conservatory.

MGM Resorts remains deeply committed to pursuing an integrated resort in Osaka, Japan,” said CEO Jim Murren in a statement released Thursday. “We announced our ‘Osaka First’ strategy and have not wavered from that plan.? We have always had confidence in our position, as what we will bring to Osaka is something only MGM Resorts can deliver.”

Murren’s comments were published just hours after it was revealed that Las Vegas Sands is scuttling plans to focus on building a casino in Osaka, Japan’s third-largest city. Rather, the largest US casino company by market value is looking to open a gaming venue in Tokyo or Yokohama, the country’s two largest metropolitan areas.

Osaka First

Previously, LVS expressed interest in Osaka amid speculation that Tokyo would be too busy with plans for the 2020 Summer Olympics to adequately address an integrated resort there and reports that some business leaders and residents in Yokohama oppose casino gaming.

While there may be opposition in Yokohama, leaders there earlier this week unveiled plans to push forward in luring a gaming venue. Earlier this year, Murren said LVS hasn’t been loyal to Osaka, comments that now appear accurate.

By Murren’s admission, the timeline could be ambitious, but the company is hoping to have an integrated resort operational in Osaka before the city hosts the World Expo in 2025. The MGM statement released today did not feature comments about that time frame.

“We are also excited about our partnership with Orix, a highly respected Japanese company with a strong presence in Osaka, as we jointly pursue this venture,” said Murren in the release. “Together, we are working to submit our response to the ‘request for concept,’ and look forward to the next steps in the process.”

Absent From Today’s Proceedings

Not mentioned in today’s scuttlebutt regarding casino goings on in Japan was Wynn Resorts, a rival to MGM and Sands in both Las Vegas and Macau. In an interview with CNBC about two months ago, Wynn CEO Matt Maddox said his company is considering multiple cities for a Japanese integrated resort.

Operators’ interest in Japan is easy to understand. The Asia-Pacific country would likely be the third-largest gaming market in the world when it’s up and running, generating an estimated $8 billion in revenue annually while trailing only Macau and Las Vegas.